Ohio AG Yost signs on to try to stop billions in student loan debt from being forgiven
Ohio Attorney General Dave Yost is trying to prevent billions of dollars of student loan debt from being forgiven.
Yost filed an amicus brief recently with the U.S. Supreme Court — along with 19 other states — arguing U.S. Secretary of Education Miguel A. Cardona’s plan to wipe away an estimated $6 billion in student loan forgiveness for more than 200,000 borrowers is “nothing more than an egregious power grab that tramples all over the separation-of-powers doctrine,” according to a release from Yost.
“The executive branch does not have unlimited policymaking power, nor an unlimited bank account to forgive student loan debt,” Yost said. “The executive branch cannot extend its authority as it sees fit.”
The Project on Predatory Student Lending filed a lawsuit in 2019 (Sweet vs. Cardona) on behalf of borrowers who believed they were defrauded by the schools they attended. Cardona agreed to a settlement last summer that would give 200,000 impacted borrowers $6 billion in debt relief.
Two for-profit higher-education companies Lincoln Educational Services Corp. and American National University, along with non-profit Everglades College, filed notices in January to place a stay on the relief.
The Ninth Circuit Court of Appeals rejected the companies’ request to pause the relief last week — paving the path for those borrowers to have their debt forgiven.
There are 151 schools in the Sweet v. Cardona settlement agreement, including Chamberlain University, DeVry University and Kaplan College, which have campuses in Ohio.
The brief argues Cardona has no legal authority to do what the settlement requires.
These states’ attorneys general joined Yost in the amicus brief: Alabama, Alaska, Arkansas, Florida, Georgia, Idaho, Indiana, Kansas, Kentucky, Louisiana, Mississippi, Montana, North Dakota, South Carolina, Tennessee, Texas, Utah, West Virginia and Wyoming.
How much student loan debt do Ohioans have?
The federal appeals court ruling is not related to the Biden administration’s federal student loan forgiveness plan, which is currently being reviewed by the U.S. Supreme Court.
Biden announced in August he would forgive up to $10,000 in federal student loans for people with annual incomes of $125,000 or less, and an additional $10,000 for people who received Pell grants, federal monies allotted for low-income students who want to pursue higher education.
There are 1,818,300 student loan borrowers in Ohio who together owe $63.1 billion as of Dec. 31, according to the U.S. Department of Education.
Fifteen percent of Ohioans have student loans — tied with Georgia and Mississippi for the state with the most outstanding student loans with, according to small business website AdvisorSmith’s 2021 report “States with Highest Student Loans Debt.” Only the District of Columbia was slightly higher with 16 percent.
The average student loan balance in Ohio was $34,923, according to the AdvisorSmith report.
Nationally, people who are 35 to 49 have the most student debt with $636.2 billion, but most student loan borrowers are people who are 25 to 34 as of the first fiscal quarter of 2023, according to the U.S. Department of Education.
Recent data also shows student loan debt disproportionately impacts Black borrowers, with students of color saddled with nearly twice as much debt as white students.
Megan Henry is a reporter for the Ohio Capital Journal. Follow OCJ Reporter Megan Henry on Twitter.